Employee Termination under Czech Law
In these turbulent days, it is extremely important for employers to have detailed knowledge about Czech labour law.
When employers want to dismiss their employees in the Czech Republic, they have several possibilities to do so. In general, the regulation is rather strict and influenced by the European legislation.
The notice of termination must always be given by the employer on the basis of the Czech Labour Code (specifically mentioning the stated reasons), otherwise the notice of termination is invalid. Also, the notice of termination must be always in writing (otherwise it is also invalid).
Termination of Employment Contract for indefinite period of time
The Czech employers’ most common way of terminating the employment contract is by giving a notice of termination to the employee. The notice period is 2 months and it starts the first day of the month following the delivery of the notice to the employee. The notice of termination must always state the specific terminating reason.
Those reasons for termination may be only:
- Employer’s Reorganization – the most used and the widest notice reason and it is possible to use for all employees including pregnant women or employees on sick leave. The company/its branch or subsection, must be either moving or closing down or the employee must be redundant due to organizational changes. The employee is entitled to a severance pay of 1-3 months’ salary, according to his length of employment.
- Change of Employee’s health:
- the employee is not able to continue working due to a work accident or occupational disease (a medical confirmation is necessary). The employee is entitled to the severance pay of 12 months’ salary, according to the length of employment;
- the employee has lost the medical fitness in the long term due to medical conditions (a medical confirmation is necessary).
- The employee lacks the legal requirements to perform the scope of work or lacks the capability to cope with the scope of work without the employer’s fault (if this is the reason of insufficient work results, the employee must be given a written warning during the last 12 months prior to the notice of termination).
- Serious or repeated misconduct (in this case, the employee must be given written warning during the last 6 months prior to the notice of termination);
- Especially serious misconduct of the employee stated in Section 301a of the Czech Labour Code. For such misconduct, the employee’s contract can also be terminated immediately, as stated below.
There is no difference between terminating a full time or a part time employment contract.
For the managers (the employees managing other employees), several additional provisions are included:
The manager stops being in his managerial position on the day following the delivery of the withdrawal notice from the position. However, his general employment does not terminate upon the notice as the employer is obliged to propose to the employee to change their further job position corresponding to their health status or qualification.
If the employer does not have a suitable position for the recalled manager or if the manager refuses it, it is an obstacle to work and at the same time it is valid reason for a notice of termination on the side of the employer.
Termination of Employment Contract for a definite period of time
According to the Czech law, there is also no difference between terminating the employment contract for a definite period of time and for an indefinite period of time. However, there are few exceptions.
First, the employment contract for a definite period of time may be renewed only two times in a row between the same contractual parties.
Secondly, there are two exceptions related to the nature of the employment for a definite period of time:
- Shall the employment be limited to the duration of performing certain work, the employer is obliged to notify the employee of the completion of such work on time (usually at least 3 days in advance).
- Shall the employee continue carrying out the work after expiring the definite time period (Section 48(2) of the Czech Labour Code) with the knowledge of the employer, the employment is prolonged to the indefinite period of time.
Immediate Termination of the Employment
Following the specific reasons for dismissal, the employer can also terminate the employment immediately.
Those reasons are:
- the employee is guilty of an especially serious misconduct (e.g. purposely caused damage to the employer, physical attack of another employee etc.);
- the employee was convicted of an intentional crime offense for a total term of imprisonment of more than one year or
- the employee was convicted of an intentional crime offense committed while carrying out the work or in connection with it for a total term of imprisonment of at least 6 months.
Termination of Agreement for Work/services (DPP/DPČ)
The Agreement for Work/services may be terminated by a notice of termination given to the other party and no specific reason is required. The notice period is 15 days.
Besides that, the Agreement for work/services can be also terminated immediately for the same reasons as employment contracts.
For Coronavirus special measures please read our article “Coronavirus from the Czech labour law perspective”.
For more information on this subject, please feel free to contact:
JUDr. Monika Rutland, partner
rutland & partners, law firm
tel: +420 226 226 026
email: monika.rutland@rutlands.cz
